Founded in 1995, the LMS-USA is governed by principles known as free church. It has a Congregationalist governance structure with no bishops or district presidents, and the national leadership has "the authority only to advise and recommend" to its member congregations.

After splitting with the American Lutheran Church in 1987, the AALC originally sought to provide a home for former ALC parishioners and other Lutherans that would encompass orthodox, charismatic, and evangelical strains of Lutheranism. During the late 1980s and early 1990s, several ministers of the newly formed AALC became concerned over the increasing dominance of charismatic or Pentecostal strains of liturgy and theology within the church, particularly at the AALC's new seminary.

This handful of pastors submitted resolutions to the AALC's June 1994 convention that would remove references to the church’s three-strand orientation (orthodox, charismatic, and evangelical), and that would remove from consideration a candidate for a seminary professorship that the pastors found objectionable. After their resolutions failed, three AALC congregations left that body and formed the LMS-USA at an April 1995 conference in Indianapolis.

Beliefs

The LMS-USA accepts the inerrancy of scripture and the Lutheran Confessions as found in the Book of Concord. Congregations have broad latitude in determining the standards for admission to Holy Communion. The LMS-USA describes itself as "moderate or middle-conservative" socially and theologically. According to church documents, the LMS-USA seeks to "fill the gap" in American Lutheranism between the more liberal ELCA and what it calls "the conservative to ultra-conservative" approach of the other Lutheran church bodies in the United States.

Pastor Training

The LMC-USA does not maintain its own seminary for pastor training. Instead, trainees study at one of a number of non-LMC seminaries while also meeting regularly with a current pastor for further mentorship. As of 2005, the church body is in the early stages of considering the establishment of its own seminary.